Coal Fights Obama with NASCAR, YouTube Campaigns

By Jim Snyder -
May 7, 2012

From NASCAR and YouTube to campaign
donations and Washington lobbyists, coal supporters are
embracing an all-of-the-above strategy to defend the industry
against what they consider regulatory overreach in Washington.

While President Barack Obama has said he supports energy
development of all kinds, he didn’t mention coal during his
State of the Union address or during a four-state, two-day tour
promoting his policies, an omission the industry took as a
slight. Worse still in the eyes of coal backers are a series of
regulations related to air pollution and mountaintop mining.

“We’re fighting for coal,” said Lisa Camooso Miller, a
spokeswoman for the American Coalition of Clean Coal
Electricity, a trade group that has announced a $40 million
campaign in defense of coal.

Underlying the debate is unease in the industry that coal
is losing its place as the fuel of choice for U.S. electric
generation. Once responsible for more than half of electricity
generation, coal’s share was down to just over 40 percent in
2011 as natural gas use increased.

EPA Regulations

The association’s members are “exceptionally disappointed
in the policies of this administration with respect to coal,”
Luke Popovich, a spokesman for the group, said in an interview.

Much of the industry’s focus has been in Washington and a
so-far unsuccessful effort to push legislation to block
regulations proposed by the Environmental Protection Agency.

The focus now will probably shift to the the presidential
campaign where energy has already been a major theme for
candidates.

Industry executives and employees have already spent more
on political donations than they did in 2008, the last
presidential election year, according to the Center for
Responsive Politics, a Washington-based group that tracks
lobbying and campaign spending.

The American Coalition for Clean Coal Electricity, whose
members include Peabody Energy Corp. (BTU) in St. Louis and Southern
Co. (SO) in Atlanta, is trying to reach voters with its campaign to
promote coal and warn about the economic impact of the EPA’s
rules.

Earnhardt Sponsorship

Last month it announced it would sponsor Dale Earnhardt Jr.’s JR Motorsports team. An 18-wheel, mobile classroom will
also be featured at NASCAR events to showcase the benefits of
the fossil fuel, said Miller, the group’s spokeswoman, in an
interview.

Meanwhile, the American Energy Alliance, which spent $3.6
million on a campaign targeting Obama on gasoline prices,
produced a 4 1/2 minute long YouTube video describing the
economic risks to Craig, Colorado, presented by state and
federal policies that would limit coal use.

Coal’s complaints play into the Republican narrative that
Obama administration regulations are hurting the economy.

The pushback could play a role in battleground states that
mine or use the fossil fuel, such as Ohio and Virginia, Michael
McKenna, an oil and gas lobbyist and Republican pollster, said.

“There is some risk, and it tends to be localized and
concentrated,” he said in an e-mail, referring to the EPA
regulations.

Romney Criticism

Mitt Romney, the likely Republican presidential nominee,
has stressed his support of coal, including during a May 3
speech in Portsmouth, Virginia, when he accused Obama of making
it “harder to mine for coal.”

Some of the EPA’s rules, such as the first-ever limits on
mercury emissions, may have broad support among voters, said
Meredith Bandy, an analyst with BMO Capital Markets in Denver,
in an interview. Mercury exposure can impair childhood
development.

“It’s fairly well-established that mercury is not
healthy,” she said.

Coal is also a leading source of carbon dioxide, a
greenhouse gas tied to climate change.

The EPA says its regulations, some of which come in
response to court orders, will save lives by cutting air
pollution and create jobs by requiring utilities to retrofit
coal plants.

Obama has said he supports an all-of-the-above approach to
energy development that creates jobs and protects the
environment.

Coal PACs

“Since taking office the president has made clear that we
need to leverage a range of domestic resources to meet our
energy needs, including oil and natural gas, nuclear power,
renewable energy sources like wind and solar, as well as clean
coal,” said Clark Stevens, a spokesman for the White House, in
an e-mail.

Coal political action committees and industry executives
and employees have spent more than $5 million on political
donations, about 87 percent to Republicans, according to the
Center for Responsive Politics.

Executives and workers at Alliance Resource Partners (ARLP) in
Tulsa, Oklahoma, have given almost $1.4 million, including a
$500,000 check Chief Executive Officer Joseph Craft wrote to
Restore our Future, a pro-Romney political action committee.

Employees and executives at Alpha Natural Resources Inc. in
Bristol, Virginia, have given more than $751,000. Workers at
Murray Energy Corp. in Pepper Pike, Ohio, have donated more than
$631,000.

Executives at the companies didn’t return calls seeking
comment.

Washington Lobbyists

In Washington, coal lobbyists have tried without success to
stop or delay what they consider to be anti-coal regulations.

The latest effort is a congressional resolution that would
block the EPA’s rule limiting emissions of mercury and toxic
gases. Senator James Inhofe, an Oklahoma Republican and the
sponsor of the resolution, believes the regulation will “kill
coal,” said Matt Dempsey, his spokesman, in an interview.

Inhofe may seek a vote later this month or in June, he
said. Obama would likely veto the resolution, if it passed the
Democratic-controlled Senate and House led by Republicans.

Domestic coal consumption during the fourth quarter of 2011
fell by 18.8 percent from the previous three months, to 227.1
million short tons, according to the Energy Information
Administration, which tracks and analyzes energy data for the
U.S. The total was the lowest level since the second quarter of
1995.

Coal Stocks

More than 90 percent of U.S. coal production is used to
generate electricity.

While exports have risen, coal companies have been battered
in the stock market. Alpha Natural Resources (ANR) stock price has
fallen to under $15 a share, from about $53 a year ago.
Peabody’s shares have dropped to under $30 from more than $60
last year.

Bandy, the BMO analyst, said that while greenhouse gas,
clear-air and other regulations can have a negative impact on
coal, market forces are the bigger threat.

“Low natural gas is so much more negative that I’m not
sure it matters that much,” Bandy said, referring to the
upcoming election.